In a report published Monday, JP Morgan analyst Fred Lucas upgraded the rating on BP plc (ADR) (NYSE: BP) from Neutral to Overweight, while raising the price target from 450p to 475p, following the unexpected settlement associated with Macondo, announced last Thursday.

"Whilst our estimate of remaining Macondo related liabilities falls by less than $2bn, we believe that by bringing unexpectedly early and essentially complete closure to the key tail risks to this tragic event BP becomes more investable to some institutions and, in a challenged space, is thus elevated as a sector relative preference," Lucas explained.

The analyst believes that the impact on the company's cash flow and balance sheet of the deferred payment schedules, along with the tax shelter, would be "very manageable." The company also appears to have improved its strategic autonomy, although this is unlikely to be visible though any large actions, until Judge Barbier approves the Consent Order. The approval is expected in late 2015 to early 2016.

"As a result, we believe that BP can trade at a tighter discount to its slightly higher SOTP, converging to the 20 percent current average discount of its peers," Lucas added.